Dongwha Enterprise acquires battery materials firm

Dongwha Enterprise CEO Kim Hong-jin, left, and JKL Partners CEO Jung Jang-geun shake hands during an event celebrating Dongwha's acquisition of Panax Etec, a secondary battery material maker in which JKL Partners had the largest stake, at Dongwha Enterprise's headquarters on Yeouido, Seoul, Wednesday. Courtesy of Dongwha Enterprise

By Nam Hyun-woo

Dongwha Enterprise has closed a deal acquiring a battery electrolyte maker, paving the way for its move into the rechargeable battery business, the wood materials manufacturer said Tuesday.

According to Dongwha Enterprise, it has gained an 89.63 percent stake in Panax Etec after completing the payment of 117.9 billion won ($97.1 million) to the battery material maker's largest stakeholder, a consortium led by private equity fund JKL Partners.

Panax Etec is the first Korean company to domestically produce electrolyte products for secondary batteries. It currently runs plants in Korea, Malaysia and China with a yearly output of up to 23,000 tons of electrolytes. Its clients include Samsung SDI.

Dongwha Enterprise said it plans to double Panax Etec's output by setting up bases in Europe after the deal, as the global secondary battery market is expected to grow from 30 trillion won currently to 120 trillion won by 2025.

“Panax Etec has the country's best R&D capability in terms of producing electrolytes, which is used for medium- or large-size rechargeable batteries, thus has an independence from Japanese technologies,” said Lee Si-joon, president of Dongwha Enterprise's chemical business.

“The acquisition will provide a new sustainable growth momentum for Dongwha, which is expanding its portfolio into the chemical business.”

In 2017, Dongwha Enterprise acquired Korea's top Penol Resin maker Taeyang Chemical and Finnish chemicals firm Kotkamills Imprex, now Dongwha Finland.